Bogota sees path to reap payoff from cell tower
BOGOTA, Nov 26, 2012 (The Record (Hackensack - McClatchy-Tribune Information Services via COMTEX) --
The borough is hoping to net a one-time lump sum payment of at least $500,000 by selling future revenues from the lease on the Leonia Avenue cell tower to a private company, officials said.
Requests for proposals to reassign the cell tower lease and another for a company to establish and manage an ambulance billing and collection system could generate as much as $700,000 for the borough, which would allow it to replenish its depleted budget surplus, said Leonard Nicolosi, the borough's administrator and chief financial officer.
The resolution authorizing the borough to request bids for the cell tower says that the borough is seeking to "accelerate the revenues" because of "concerns that technological advances in the field of communications may make cell towers obsolete and thus eliminate a source of revenues to the borough."
TMobile Northeast LLC has a five-year lease on the site, with the option to renew. The company pays the borough $25,000 a year in rent, with a 3 percent increase, according to its 2009 contract.
Two telecommunications providers have equipment on the tower, and there is additional space to lease to three more, Mayor Patrick McHale said.
In addition to the payments from TMobile, the borough collects a percentage of the fees other companies pay to use the cell tower, he said.
"I get the feeling that we won't need all these cell towers anymore the way that technology has been changing over the years," said McHale, who first proposed the idea three years ago.
Nicolosi said there was concern when the idea was first broached that the borough would be giving away future revenues.
"Forty years from now is a long time away," he said. "The biggest issue is that the technology is evolving so quickly on these things that we don't want to be stuck relying on a revenue stream that disappears because no one needs it anymore."
If the borough moves in that direction, it will be following the lead of Jamesburg, a small municipality in Middlesex County, which sold its TMobile lease this year to Wireless Capital Partners LLC, a California-based company.
In the second proposal, the borough plans to bill insurance companies, Medicaid and Medicare for the cost of using the Bogota Volunteer Ambulance Corps to transport their customers to the hospital, which now is done at no charge.
Those who do not have insurance will not be billed.
The revenue could be used to buy ambulances and other equipment for the First Aid and Rescue Squad, freeing up funds in the budget to pay for other municipal services, Nicolosi said.
Lodi, Fairview, Cliffside Park and Fort Lee already bill insurance companies for transporting their customers to the hospital, he said.
Nicolosi said the company that will run the billing and collection program will keep a percentage of the fees collected. The rest will be returned to the borough, he said.
Bids on the billing and collection service are due on Dec. 3.
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